Haoudh El Hamra-Arzew Oil Pipeline

This article is part of the Global Fossil Infrastructure Tracker, a project of Global Energy Monitor and the Center for Media and Democracy.

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Haoudh El Hamra-Arzew Oil Pipeline is an oil pipeline in Algeria, Africa.

Location

The pipeline runs from Haoudh El Hamra to Arzew in Algeria.

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Project Details

• Operator: Eni Group, Spie Capag, Sonatrach
• Current capacity: 661,000 barrels per day
• Proposed capacity:
• Length: 822 kilometers
• Status: Operating
• Start Year: 2005

Background

The 822-km OZ2 Pipeline was completed in 2005 was projected to be able to transport as much as 25% of France's oil consumption at the time of its completion. The OZ2 pipeline runs between the southeast Haoud El Hamra oil field and the northwest port of Arzew and is located parallel to the OZ1 Pipeline built over 30 years ago. The pipeline was seen as a key tool for increasing exports and increasing the country's hard currency revenues.

In 2000, Saipem, a subsidiary of the Italian company ENI, in association with the French company Spie Capag, won an EPC (Engineering, Procurement, Construction) contract from the Algerian oil company Sonatrach. The $324 million project consists of six pumping stations to pump oil through the pipeline and a new terminal at the port of Azrew to receive the oil. As part of the overall contract, a British Engineering company Demag Delaval Industrial Turbomachinery Ltd (DDIT), which is owned by Siemens, was responsible for supplying 15 gas turbine units for the pumping stations along the pipeline.

In 2000, Sontrach also awarded two more contracts for the construction of the pipeline itself. The pipeline project was divided into two sections of 419 km and 403 km, totaling 822 km and costing $185 million. The construction of the first section of the pipeline was awarded to Algeria's Cosider Iron and Steel Group and Halliburton Co. subsidiary, Brown & Root Condo. The second section of the pipeline construction was awarded to Russian companies Stroy and TransGaz. The first section and second section contracts were worth $95 million and $90 million respectively.